In gold's history there has been many smart people that have been humbled by the metal as it continues to grow in value. There are many expert that have claimed gold has hit its high, but gold continues to grow anyways, and is now sitting at $1,700/ ounce.

It takes a brave man to suggest that Warren Buffett has missed a point. After all, unless you are Carlos Slim or Bill Gates, a comparison of his bank balance and yours will show that he caught quite a few that you and I only saw when it was far too late.

However, as Mr. B rails against gold in an article for Fortune magazine, it’s tempting to think that he just might have it wrong when it comes to the oldest haven of all. He mounts all the attacks that exasperated non-gold-bugs often go for: the stuff has no inherent value, it underperforms stocks horribly over time and has merely become a self-inflating bubble in its long climb to record highs.

Perhaps he’s right, but, in its enduring relationship with mankind, the yellow metal has a history of humbling very smart people.

John Maynard Keynes denounced the gold standard as a barbarous relic. Soviet Marxists dreamed of the day when gold would be consigned to the scrap heap, literally and figuratively; useful only for lavatory fittings.

Closer to our own day, it’s still fashionable to snigger at Gordon Brown’s decision, when U.K. Chancellor of the Exchequer, to sell off British gold in favor of paper assets between 1999 and 2002. Gold prices were at 20-year lows back then, primed as we now know for a record upward charge.

So please, be my guest and snigger away. But Mr. Brown didn’t make this decision alone. The doctorate-garlanded staff of Her Majesty’s Treasury went along with it too.

And now Keynes is gone, the Soviet Union too, and even Gordon Brown seems to have disappeared. But here’s gold, all yours for $1700 odd per ounce.

The reason investors like gold is not because they hate stocks or real estate or anything else. It’s high because the word of governments is in disrepute as it hasn’t been in living memory.

Across the developed markets, bonds and currencies have been debauched to cover debt. Even claims on the U.S. Treasury aren’t the rock solid bet they once were. They may be in practice, of course, but in theory it’s a different matter. The U.S. is no longer ‘triple-A,’ and it’s still wrangling over a budget that is going to need ‘Greek-style’ cuts to make spending sustainable.

Top credit ratings are now the preserve of smaller, less liquid economies. The world’s investors simply cannot pile into Australian or Scandinavian bonds in the same way they used to run for cover in the Treasury market. There aren’t enough of them.

Gold may well annoy the likes of Mr. Buffett, and swashbuckling investors everywhere, who will probably continue to reap better rewards elsewhere. Good luck to them.

But in a world short of trustworthy governments, gold will remain a more important and permanent part of portfolios than it was in the pre-crisis days of innocence.